[ad_1]
Our new Hands off our investments campaign warns that even modest changes to key investor taxes could do serious damage to the UK stock market and discourage more people from investing for the long term.
IG analysis shows that a two percentage point rise in dividend tax and capital gains tax (CGT) could wipe £4 billion off the value of the FTSE. Meanwhile, cutting the pension tax-free lump sum to £100,000.00 could reduce annual pension contributions by around £300 million.
These findings are based on detailed economic modelling that combines UK investor ownership data from the Office for National Statistics (ONS) with peer-reviewed research on the impact of tax changes on market values and investor behaviour. Our approach allows us to estimate not just the immediate market effect of tax hikes, but also how changes could influence long-term investing decisions and pension contributions across the country.
Millions of people across the UK are trying to plan for their futures through pensions and long-term investments. These are not the preserve of the wealthy – they represent the savings of ordinary people working towards a more secure retirement. New or higher taxes on pensions, share sales and dividends would undermine that effort, punishing prudent savers and eroding confidence in investing just when the country needs it most.
If the government truly wants to create a nation of investors, it must put its money where its mouth is – not raid people’s nest eggs. Frequent changes to taxes like CGT also create unnecessary uncertainty. For many, one of the biggest perceived risks of investing is instability, and constant tinkering reinforces that fear. Leaving CGT alone would send a clear message of stability and support for retail investors, showing that long-term investing will be rewarded, not penalised.
Commenting on the campaign, IG’s UK Managing Director said: “If we want to build a nation of investors, we cannot make it less attractive to invest – whether that’s in an individual savings account (ISA), outside of an ISA, or in a pension. We’re asking the government to keep their hands off our investments: no raids on pensions, no hikes to dividend tax, and no increase to capital gains tax.”
What IG is calling for:
- No reduction in the pension tax-free lump sum
- No increase to dividend tax
- No increase to capital gains tax
If the UK wants more people to move out of cash and into the stock market, it must make investing more appealing – not less. Leaving these tax rates unchanged would send a strong signal that the government is serious about supporting long-term investors and building a stronger, more stable stock market.
[ad_2]
Source link